By Marc Haskelson
The president and CEO of this HIPAA compliancy software company made some minor operational and sales tweaks that showed immediate returns.
Software Executive sat down with Marc Haskelson, president and CEO of Compliancy Group, to discuss some of the latest changes his firm has made to billing and discounting — and just how big a difference it’s made for his bottom line.
Q. WHAT ARE SOME OF THE BIGGEST OPERATIONAL BOTTLENECKS YOU’VE FACED RECENTLY?
One of the biggest constraints we’ve seen within the past year came from our billing process. Like many firms, we used to do invoicing twice a week in large batches. And this process worked when we were a smaller firm. But as we’ve grown, the model just started to become more and more cumbersome, especially for members of our operations teams who needed to dedicate so much time to processing, mailing, and handling billing requests.
Q. SO HOW DID YOU ALLEVIATE THE ISSUE?
Now, we’ve decided to implement an automated billing platform that processes all billing within 24 hours of the point of sale. Not only has this relieved stress on our billing department, but it’s also made for much faster collections. We’re getting paid on time, without the need to dedicate personnel to chase down outstanding accounts.
This has also given us the resources to give our operations team assignments and projects that are actual actually helping to grow our business, now that they aren’t bogged down with administrative wrangles.
Q. WHAT ARE SOME OF THE CHANGES YOU’VE MADE IN POSITIONING YOUR PRICING?
That’s been another big change. We began to encounter some issues with discounting our services. Personally, I like to give our sales team a lot of personal autonomy when it comes to managing their pipelines. But as we’ve grown, our method and philosophy behind discounting is another thing that’s needed to change.
Now, rather than outright discounting, we position our pricing with a “built-in” discount. The way it works is like this: We sell our HIPAA compliance SaaS offering on an annual subscription model. We offer two payment plans as either monthly installments or a single annual payment. So, to make up for the uptick we’ve seen in discounts, we decided to discount the pricing on our annual payment option by 20 percent from our monthly payment option. What we’ve done is essentially create a built-in discount, and the results have been fantastic.
Q. ARE THERE ANY NUANCES TO IMPLEMENTING A PRICING MODEL LIKE THIS?
Yes, I think it’s essential that sales reps position the difference in pricing not as a surcharge for monthly payment, but as a discount for annual payment. And all of the internal tracking, monitoring, and accounting we do assumes that the MSRP is the lower annual ticket price. Again, when implementing a pricing model such as this, you need to ensure that messaging coming from your sales team stresses this distinction as a discount. That way, clients are placated and you won’t have to worry about runaway discounting on the part of your sales team.
Q. WHAT ARE SOME OF THE BENEFITS YOU’VE SEEN FROM THIS NEW DISCOUNT PRICING MODEL?
We’ve found that the actual need for discounting has significantly decreased. It’s really amazing — prospects are much less likely to ask for a discount when you provide them with one from the onset. And again, at Compliancy Group we value personal accountability and autonomy for our team members. This new model gives our sales folks a tool to discount without actually discounting or needing permissions from sales managers. Plus, it’s helped our sales team realize higher commissions, which is a strong enough motivating factor on its own. When we put it that way, our team took to the new model with gusto. And the results have been tremendous
MARC HASKELSON is the president & CEO of Compliancy Group, a HIPAA compliance software company based in Greenlawn, NY. He is a Software Executive editorial advisory board member and is chair of the CompTIA Business Applications Advisory Council.